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Old Dominion Earnings Drop Slightly

Earnings at Old Dominion Freight Line, High Point, NC dropped slightly in the first quarter.Revenue from operations for the first quarter was $112.8 million, up 13.5% from $99.3 million for the first quarter of 1999. Net income decreased to $2.3 million from $2.5 million, while operating ratio was 95.8% for the quarter compared with 94.5% for the first quarter of 1999."Old Dominion's results of operations for the first quarter were impacted by three factors," said Earl E. Congdon, chairman and CEO."Severe weather during January directly affected 68% of the markets we serve and resulted in an estimated revenue loss of $2 million. Much of the direct cost that would have been associated with this revenue became fixed in order to maintain our highest level of service. Second, the company implemented full-state coverage in 16 states on Jan. 1, 2000, and at the same time opened a newly constructed 247-door breakbulk facility on sixty-six acres in Morristown, TN. This combination of providing full-state coverage and re-configuring linehaul operations to take advantage of the expanded breakbulk capacity caused a short-term loss of productivity and increased linehaul and platform costs during the quarter."Third, we contended with significantly higher prices for fuel and other petroleum-based products during the first quarter. Consistent with the industry, the company assessed a fuel surcharge to offset these increased costs; however, the fuel surcharge did not keep pace with the dramatic rise in fuel prices early in the quarter. Currently, fuel costs have stabilized and the company does not anticipate the net cost of fuel to have a significant impact on operating results for the second quarter."